Good morning. Here at the Prime Tower or online, anywhere from anywhere in Switzerland or the rest of the world, warm welcome to our Media Press Conference for the first six months. What message will you take with you today? It won't just be a message for those who are here today, but also the APRO. What am I trying to say? There are two things that you will take with you. First of all, that we have been able to increase the FFO1 in an environment in the context of closing Jelmoli and also making several acquisitions that we've been able to compensate for. That's the main message, and FFO1 is the cash figure that ultimately is responsible for the dividend. The second piece of information is that the market trusts this company. We have been able to raise CHF 840 million new fresh capital, CHF 500 million.
Forty was an asset management capital increase. We would like to thank everyone for this, and this is the start of this conference. This kind of confidence is not a matter of course. Key issue topics of the first six months of this year, I'm not going to read out everything, but let's start with this strategy. You all know the strategy is clear: open closure of Jelmoli at the end of February, which means that the two pillars, direct real estate and commercial real estate, and the second pillar is asset management. Some secondary allocations are also part of the portfolio, but it's primarily residential asset management, and that makes us unique, particularly after the integration of Fundamenta . We're not just talking about commercial real estate, but also about residential real estate. What are the highlights of our portfolio?
Despite the sales last year, and some of them were essential, we grew to CHF 13.3 billion, revaluations of CHF 102 million, and those are mainly due to new rentals. The like-for-like growth was 2.2%. That's a very attractive like-for-like growth. We were able to purchase two properties. The first one in Geneva was in the first six months. The one in Lausanne was actually communicated last week, not quite in the first half of the year, but nevertheless, these are very important first acquisitions from the capital increase. We also sold some properties to the tune of CHF 70 million, six non-core properties, as we call them. Those were achieved 4.1% over fair value. This shows that we have an excellent portfolio, but it also shows that we are evaluating very well.
Our evaluation seemed to be correct, proven by the fact that we are able to sell above fair value. The second slide here now concerns the operational performance. The like-for-like growth was 2.2%, as I mentioned, and the major part due to new rental contracts. On the whole, we lost a little in rental income, CHF 17 million to be precise, temporarily, due to the refurbishments, not just of Jelmoli, but also Fraumünsterpost and Talacker . That rental income will return. I also saw that some of you said that the rental income is not quite as expected. Actually, we have been announcing this for two years, that this would happen with the closure of Jelmoli, but everyone was still surprised. We were able to largely compensate for this, and you can see where, which is with the increase in asset management by 41%.
The vacancy rate is about 4.0%, and we expect that we will have a vacancy rate of 3.8% by the end of the year. Let me say a few words about this vacancy rate, which is maybe not so obvious. We increased or we improved the vacancy rate like-for-like. This made a contribution to these positive revaluations, better rental contracts, and lower costs. The reason why it is increasing a little is because the new projects such as Pont-Rouge and JED have been added to the portfolio. I have tried to explain this several times. These new projects are usually not fully rented out at the time that they are added to the portfolio. Maybe they're rented out at 80%, and this automatically leads to a higher vacancy rate compared with a company that does not do project development.
This explains why the vacancy rate has increased, but will go down again towards the end of the year. The like-for-like vacancy rate has decreased, and that's the message you need to take with you. We've been able to sign new attractive rental contracts and fill the gap. All of this led to a stable EBITDA, largely at the level of the previous year. The capital increase of CHF 300 million already was aimed at a pipeline. 50% was invested in acquisitions in Geneva and Lausanne, and we also have further acquisitions in the pipeline. We were able to, the net yield is 4% in the two investments. The LTV was at 38.4%. The end of 2024, it was 38.3%. Actually, at the mid of 2024, it was above 39%.
This level is now, despite the payout of the dividend in the first half year, this always has an effect on the LTV in the first six months of the year. The most important figure is the increase of the FFO1 by 3.4% in the first six months of this year. I'm not going to discuss all of the figures here, just the ones that I haven't discussed yet. One is the fees, which means the asset management fees, CHF 38 million. This is an increase of almost 41% compared to last year. This is also an increase of net asset value by 2% to CHF 102, rounded up. This first six months has been very successful. This doesn't always look like that on the surface, but there's a lot of work behind it in order to compensate the lack in rental incomes due to the new projects.
We've been able to add projects to the portfolio. We reduced vacancies, we reduced guests, and we did excellent financing activities, and that has led to this excellent result. Now, a couple of words on the market transactions. Let me start on the left. The transaction market is doing well compared to a year ago. We are seeing a lot of transactions just for our portfolio. Just looking at Swiss Prime Site , we have CHF 600 million transactions in asset management in the first six months. We bought properties for the number of CHF 200 million. That was transactions worth CHF 870 million. There is a transaction market that is very healthy and that is going well. We're not the only ones. There are a lot of international investors that have done capital increases, and that capital needs to be invested now, of course. What else are we seeing?
Sales and leaseback transactions, we've done two. The second one was a classical sale and leaseback on the property in Lausanne. The first was semi-classical because we didn't lease in the same location, but in a different building. The idea behind it was the same. The transaction market is working well. Now, let's talk about rental income. The demand remains high, and we can see that here. When we are able to achieve rental contracts above market rates, then this shows that we have excellent locations and that the demand for those locations remains strong. What are the effects of the funds in the U.S.? Of course, we looked at this with respect to our portfolio. Our tenants are service providers, so we do not rent out to exporting companies who are affected by the tariffs temporarily. Of course, we're hoping for this to change again.
Our tenants are service providers who are not affected immediately. Of course, whether this will have an effect in the years to come, I can't tell, obviously, but at the moment, things do look good, and we are able to receive the leases on time. Last point, valuations. I already mentioned revaluations based on better rental income, lower like-for-like vacancy rates, and a reduction of property costs. The question is whether we can look at both commercial and residential properties, and there was a gap here. If you now look at the discount rates for commercial real estate, there's hardly any change, but there was change in residential real estate with a clear reduction of discount rates, both nominal and real discount rates, with significant increased valuations and the effects that it has on the asset management. Now, it's over to the figures from Marcel.
Thank you very much, René, and a cordial welcome to you on this not very sunny day at Prime Tower. I'll take about 10 minutes to lift the mood with our figures. Beginning with income, I'm not going to begin at the top, but at the bottom of this table. From my point of view, this is the relevant figure for you to take home today. I'm talking about the adjusted operating income adjusted for Jelmoli. It makes sense in this first half year. Jelmoli closed its operations at the end of February, so it's not surprising that we have less income there. This is the relevant figure. As far as I'm concerned, we had just under 2% more operating income in the first half year, attributable to asset management and rental income.
Beginning with rental income, as René said, we had very strong underlying like-for-like growth of 2.2%, and I'll be giving you more detail about this later on. In absolute terms, we're slightly below that, 2.8% , - 2.8%, about two-thirds of the loss of rental income was compensated for. I think this is a strong performance, and I'll be giving more details about this later on. For asset management, it's been mentioned briefly, very strong growth by 41%, just under 41% due to three components. On the one hand, higher average AUMs, as we demonstrated, went up to CHF 13.7 billion at the end of the first half year. Secondly, higher capital increases and the ensuing transactions. Capital increases are the basis for new money to be invested in properties. This almost doubled or more or less doubled compared to the previous year.
The third component is Fundamenta, the acquisition we made last April, the April of last year. Of course, we have the full half year included here compared to the previous year where it was in for only three months. So much for income. Let me move on to the other side, expenses. I propose to begin at the bottom. Here, significant components in absolute terms, of course, are due to the closure of Jelmoli's operations at the end of February, and personnel costs and other costs are considerably lower than the previous years. Despite the higher operating income that we achieved, as outlined, operating expenses were reduced. In my mind, this is really a strong figure because we had Fundamenta with about 60 people that we took over and consolidated for the entire half year and only for four months.
Yet, we managed to reduce operating expenses because we have about CHF 4 million of synergies in asset management or in the group from the acquisition of Fundamenta and thus reduced the entire cost ratio. The second component I would like to highlight is the top line real estate costs, which was reduced significantly by around 8%, which is due to two reasons. On the one hand, it's due to our strong focus on the team on where to be more efficient in using our resources. On the other hand, it's the result of portfolio adjustments that we made in recent time. We tended to take smaller properties and sell them, which produced a higher cost ratio. You can impressively see this in this figure that we reduced by around 8%. I'll be giving you more details about this.
We have a plus-minus stable operating profit of 0.9% lower than the previous year as a combination of the two figures I mentioned before. Revaluations I'll be talking about in the next few charts. This year, we're moving on from operating profit to FFO and profit to focus on the table that you can hopefully read here, the two important components that have changed. On the one hand, you can see the cost-effective interest expenses, cash-effective interest expenses that were reduced. This reflects that we have reached a certain peak as far as our financing costs are concerned. We'll see that average financing cost has fallen by about 13 bps compared to the previous year, which reflects, I believe, the end of our transformation on the financing side.
We are now betting on a financing portfolio that is highly efficient across the various cycles, and that has helped us to fully benefit from the lower interest rates. On the other hand, you can see a decrease in taxes. We did a good job in the first half year in this regard with some tax administrations. We made new agreements that meant that in the future, our tax load will be slightly lower. In the first half year, this is reflected, as you can see here. In total, this gives us an increase of around 6.5% of FFO increase in absolute figures. We have had a higher number of shares on the basis of the shares of the share. It's a plus of 3.4% to CHF 2.10 in the first half year. The intrinsic value of our share rose by around 2%.
We're talking about the first half year, that's to be borne in mind. The first half year includes dividend payout, and yet we have a rise of 1.9% over the previous year. Now, I'd like to give you more details for real estate and asset management. Let's begin with real estate. The development of rental income is shown here. We've shown this chart in the past. The difference to what we're having here is this is the consolidated level. You can see the split as we're having it at consolidated level. In the past, it was a bit more complicated as a large part of the income was from Jelmoli, and there was a difference between the segments view and the consolidated view. Given that Jelmoli will now be externally led or does not generate any rental income, this should improve comparability and readability.
Now, you can see the composition of CHF 17 million that was capital recycling, up around CHF 8 million sales that primarily occurred in the second half year of 2024, and now having effect on the rents. The larger block is around $9 million of redevelopments composed of CHF 6 million- CHF 6.5 million due to Jelmoli, the third-party lettings that we had, and the other CHF 2.5 million - CHF 3 million is due to Fraumünsterpost and Talacker . This is very temporary. Tala cker will go online again in September, October. It's fully let currently, and Fraumünsterpost will go online at the end of 2026. Jelmoli, as we communicated several times, will be online 2027 with clearly higher rents compared to the ones that we lost now.
This was compensated for more than two-thirds, as we mentioned before, due to smart planning, as René mentioned, around CHF 5 million from new objects, new projects, Alto Pont-Rouge and JED, the new construction at JED Schlieren, and then Basel Stücki Park that have contributed to this. CHF 1.2 million is the acquisitions, particularly Geneva, that are having an effect already partially. The important part here is how much can be generated from our portfolio, around CHF 4 million from the existing properties. This adds up to the 2.2% of EPRA like-for-like growth, which we mentioned before. The bottom part, 1.4% on real rents, is important to us. Why is it important? There are really two things to read out from this. First of all, the portfolio is in the right place.
If you're in the right place, it's difficult to generate like-for-like growth, and you're close enough to tenants, close enough to the markets. I think with 1.4%, we can demonstrate we're very close to tenants. By the way, it's the same figure as we had last year. The absolute figure of 2.2% is slightly lower because inflation is lower, so the indexing component went down, and the real component is a little higher than 2023 and the same as 2024 and shows the consistency that we're having in the portfolio. René mentioned it a minute ago. On a like-for-like basis, our vacancy rate decreased. It was mentioned a decrease of 2.9% if we work out new developments, and we can see that in the EPRA like-for-like growth, positive figure from the reduction of the vacancy rate.
Next, on asset management, we are giving you a little more transparency where the fees are coming from. Very strong growth in underlying fees, management fees on the one hand, and construction development and other fees. All of those fees are recurring. They're not transaction-dependent. Average growth of 27%, 28% in these two areas. That's the big volume of fees. For the non-recurring fees, I mentioned it before, we doubled, more or less doubled issues, and you can see it went up to around CHF 11 million for non-recurring fees. This clearly adds up to more than two-thirds of recurring fees or recurring income. If you look at them, only the management fees in itself show a clear gap to costs, around CHF 14 million of costs. This shows the stability of our business models as it's operated by Prime Solutions. EBITDA rose by 64%, and we benefited from the synergies.
Clearly, the ones that I mentioned before, the EBITDA margin increased to around 63%, increased by around 8%. A few words on the balance sheet. The key part of our balance sheet is our portfolio. You can see the portfolio composition here and how we come up from CHF 13.5 billion to CHF 13.3 billion. You can see the purchases and the investments in our major developments, in particular BERN 131 and some leftovers from JED or Stücki Park . The large part is, of course, the new projects, in particular Jelmoli and Yond. Then we have the CHF 105 million valuation result. You can see at the bottom, just about two-thirds of the valuation results are not due to discount rate changes, but is self-generated, like-for-like growth or like-for-like reduction of vacancy and good renewals that we had. Around 33%, 34% is due to valuations.
We can see the assumptions that a recent partner made, expectations of lower slightly as far as inflation is concerned, from 1.25% to 1%. There is a relatively considerable reduction of the nominal discount rate, and the larger leave is the real discount rate, which remained the same more or less and went down by one bip if you look at it a little more closely. Two more charts on financing. I mentioned it a minute ago, very briefly. We're broadly financed, and we're actually where we got started or wanted to be four years ago. We have convertible and unsecured bonds, convertible bonds, secured mortgages, and unsecured loans in the Swiss market. You can see the average maturity is more or less stable. We want to be around four and a half years.
We kept that stable, the average interest rate, which shows the turn in around in the interest rate development for the first time that I've been presenting. We're below 1% at 0.98%, which is a clear reduction over what we saw last year at 1.1%. Just to answer the question that will be asked, if we did any new financing, we would be slightly below what we're having in terms of average interest rate, certainly no higher interest rates than this. Perhaps another figure I haven't mentioned, LTV. In the half-year period, it's slightly higher, usually because you only have a half-year of profit, but they have paid out the dividend. We're currently very comfortable with what we're having there, with LTV at 38.4% to use it and to maintain stability at the same time. In conclusion, perhaps a word about maturities. The average is 4.2 years.
We have a larger maturity this year in unsecured loans, private placements, actually, that we prolonged, CHF 120 million at 0.17%. As you can see, there are highly appealing opportunities. The CHF 250 million is a bond that will mature in September. For the next 24 months, we want to make sure that we don't have to go to the capital market or other sources just for reasons of stability and safe planning. With our liquidity reserves of just under CHF 1 billion, I think this is we're very comfortable there. As far as finances are concerned, let me hand it back to René.
Now let's look at the individual segments. Starting with the portfolio, I don't need to explain the different locations across Switzerland. You've seen it before. What's important now is that we still have 137 properties, and that shows how capital upcycling should be done by selling and then investing the cash into developments at a better location. We have expanded our exposure in the French market, speaking part of Switzerland. As I already mentioned, this is Lausanne towards [Mosch]. I think Lausanne and [Mosch] will one day become one. That's an interesting region. It's also a region where we're seeing transport investments and transport infrastructure. That's interesting. The more you position yourself, the more you can then benefit from future developments in terms of property fair values. This is the portfolio distribution. We already mentioned that after the Jelmoli transformation, we now have almost 50% in offices, sales 20%.
Let me remind you, in 2009, we purchased the Jelmoli property portfolio, and then we had a retail share of 35%. We've done a lot of work to reduce that rate. I think if you have retail in a prime location, it should be between 18% and 20%. That's what we think is a good measure. Also, around 50% offices is also a good rate in our opinion. On the right, you can see our various tenants. I'll mention Globus in a moment. Here, the portfolio upcycling, you know this quadrant in the top right-hand corner. I would like to thank those who've made it easy for us because we have sold Oftringen and Romanel Dietikon. These are places that many people won't even know by name. We invested in Geneva, Lausanne, and Bern. That's exactly the kind of thing that we want to see. That's typical capital upcycling.
The area shown in red is our pipeline for sales, ± 1% of total volume. That will be approximately CHF 130 million. That is going to be sold this year and next year. The upcycling strategy will be concluded. That means that all of our properties will be in quadrants one or four. Vacancies, we've heard a lot about it. We currently have 4%, and by the end of the year, we're going to be below 3.8%. We have some major new tenants that are shown here and some major contract extensions, amongst them with Ernst & Young. I'm mentioning this because they are direct neighbors here on the Hardbrücke along the rail line. Here, this is our acquisition in Lausanne West. You will see that there's a new train station and the new ice rink of the [ICE de] Lausanne. New flats are being built.
There's a lot going on here. It's a thriving location that is going to continue to thrive. By the end of 2026, the tram line will be opened, and the last step is going to be to connect NOSH as well. This is promising 4% net yield, and we already have 15 very renowned tenants. This slide is always interesting, and it's particularly interesting today. Now, the WALT is almost five years, and let me just point out that the 17% that are going to run out or reach the end at the end of 2026 also includes Globus. I have good news here because we have agreed with Globus to continue operating all three locations, or actually four, because Offering is also one of them, which is not just Globus, but also their location. It's actually four locations, but three sales locations.
The second piece of good news is that the contracts are going to be remodeled, and I think both parties will benefit. The future contracts for the three locations are not going to have the same duration because this is always a problem. Geneva is going to be extended by 10 years with a fixed-term contract, Lausanne by eight years, and Lucerne by seven years. Ten years for Geneva, always counting from the 1st of January 2027, because the current contracts are still valid until the end of 2026. From the 1st of January 2027, 10 years for Geneva, eight years for Lausanne, and seven years for Lucerne. That doesn't mean that there won't be an extension after that, but we just wanted some kind of staggering in the terms.
The third piece of good news is that the negotiations concerning the necessary adjustments of the rental contracts are ongoing and are nearing conclusion. That's my news from Globus. Apart from that, the slide is what you're used to. This is a more interesting slide here for you. You can see the Münsterpost on the left-hand side is going to be concluded next year, properly refurbished. BERN 131 has now been completed. Some tenants have already started occupying the buildings, such as Z ü rich Insurance. Destination Jelmoli in Z ü rich, you will see that the investments are not CHF 130 million, but CHF 150 million now. We've been able to hedge that better. Now the current status is that whether we would be able to ease the old burdens. We have the new security. For the construction site, on the 1st of September , work is going to start.
That's when the refurbishment is going to start properly. The YOND campus in Z ü rich is a continuation of the YOND project that is already completed, the four properties here. We are continuing the development project with almost 50% degree of letting with Züriwerk as a tenant, amongst others. A smaller project from Basel, the Steinenvorstadt, where we have just recently submitted the construction application. We are going to continue to communicate our sustainability strategy in more detail again at the end of the year. Let me just say that we are going to be at net zero at the end of 2040. We're still working on this actively. We're certainly one of the most active companies in terms of circular economy. This is going to change the entire business approach. Let me always give you the example.
If you have a material that you need for a construction project, this requires energy to produce. If you can reuse it after 50 years for another 50 years, it doesn't take a genius to work out that this helps save a lot of energy. That's why the circular economy is so important. To give you additional information, BERN 131 is being built with wood from the Canton of Bern. It's not because that's where I'm from, but it's simply because often local wood can be sourced, but local wood does not mean that it's Swiss wood. Local wood could also come from Germany, Austria, or the Czech Republic. The only criterion is whether that type of tree is also grown in Switzerland. Here we actually used wood that actually grew in Bern. Now here, asset management. I don't think I need to explain any more about this slide.
We have these three pillars: fund management, asset management, and real estate advisory. We now have assets under management of CHF 13.7 billion and CHF 540 million of new capital in the first six months. As you can see, if you look at the CHF 540 million, this is almost the same level as in the total of 2024. That means that we have almost reached our objective for the entire year. Now here, the incoming cost performance, CHF 138 million, have already been shown. Let me just point out again, and Marcel said this too, if you look at all of the recurring fees shown on slide 14, in addition to the management fees and the development fees, if you add all that, because each of those products also have their own business plan for the properties.
That means that if you add all of those, this will bring you to CHF 27.3 million recurring fees. With all of the costs, that's CHF 14 million. If you now look at the entire recurring fees, that is 200% of the costs, and that makes this business so stable and robust. Of course, we have a lot of synergies within the corporation that we can use within the structure and on these platforms. Now, the outlook, this is the last slide for today. First of all, the vacancies are going to be below 3.8% by the end of the year, not much below that, if you're asking. The LTV below 39%. After six months, it was 38.4%. The LTV is going to be below 39%. Assets under management, I said that is going to be tangibly above CHF 14 billion. Tangibly was a question of what this means.
To define this, this means between CHF 4 billion and CHF 14.5 billion. The FFO1, as we published in the media release, is going to be at the upper end of the guidance. That means that formally, the guidance has been confirmed. The material means that we now have more shares than we had in February when the guidance was issued. That's a material improvement of the guidance, even though formally it's the same. That was just my comment. I think now we can start with your question. Let me just say, overall, [Keiligh] was ill and I've been missing him, but he's here now. Let me just say, one question after another, we'll start in the room, and then we'll also take questions online. Of course, here with me, Anastasius Tschopp for Asset Management questions, Urs Baumann for anything to do with developments, and Karin Voigt for the portfolio.
Now let's go.
Thank you. The first group of questions relates to slide 25. It was mentioned that by the end of 2026, Globus will account for a large part of the maturities. Now, you're in negotiations, of course. Can you make a statement about the level of rents and the investments required and the counterparty risk? Who is going to be the counterparties? Is it companies or is it a group of companies? What about the rental deposits? That's a very long question. Given the current negotiations, I cannot comment on everything. We assume that the fair values of the properties remain the same. That's as much as I can say. How this will be expressed in rental agreements, we're currently negotiating, but we want to maintain fair value constant. Remaining with this slide of the 17%, if you deduct 4.8%, you still end up with 12%.
The question is, where could the vacancy rate be next year if you have a lot of maturities? What are the discussions that you're having? Can we assume that it will be below 4%? I pass it over to Karin in a moment. My medium-term goal for vacancies is 3.0%, medium term. Now, over to Karin. We're not going to generate vacancies. We're actively working on re-letting, and the modifications that are going on are looking positive. The question is not going to go up. This brings me to the second question on slide 24. Looking at the picture, it's relatively easy to find out what property this is. Thank you very much. The question is, who is the counterparty for the rental contracts? Is it one single or is it several counterparties if it was only one? How about the default risk?
We're talking about one single counterparty currently, but if anything goes wrong, we can take over the 15, 10 rental agreements directly. Thank you. Next question. How will you proceed on the MAG premises? For the MAG premises, I think you were able to read it. The court approved the objections, and we are currently thinking of taking it to the next level. I think September 11th is the deadline. There is a court holiday at the moment, and we keep hearing, could we perhaps move on to the Lacaton-Vassal project? Those who are loyal with the ones who object, I can say we are not going to do that. We have a plan B. We're going to go back to the plan B, but we're certainly not going to move on with the other object that we haven't settled for. Anyone else in the room to ask a question?
You all have the same questions as Ken had. Holger Frisch from Zürcher Kantonalbank . Question on transactions. Two transactions were made in the first half year. How about the other transactions that were in the pipeline at the capital market stage? They continued to be in the pipeline. We're not exclusive in all regards. That's why I cannot really comment on that. We would assume that the second part of the capital raises, including outside capital, we issued 200 of the 300, and we would like to invest as much again. We are confident that we will be able to do that. It should be invested by the end of the first half year of 2026 when full rental income will be visible from 2027. We're still working on the basis of a pipeline, including projects in the French-speaking part of Switzerland, but not only.
I saw that there were three properties up for sale which you reclassified as existing properties. What were they? What properties were they? What were the reasons for you to decide not to sell them? We didn't decide not to sell them, but we are showing the probability within the next 12 months. All three of them depend on certain approvals, construction approvals that we need to get because we're talking about modifications that will no longer fit our portfolio, but are highly value accretive. We're not assuming that we'll be managing to sell them within 12 months, but maybe 15 months. My final question on Jelmoli, on the annual results. Investment costs were announced to be 130, but now they're 150. Is it due to legacies? It's much simpler to build a new property. I can tell you. I can tell you exactly how much it costs.
For refurbishments or modifications, you need to bear in mind that there were five stages and there are walls and you don't know where you have pollutants that you need to clean up. We found out in the meantime, and we have the final figure referring to that. There are static effects ever since we took over Jelmoli. Earthquake standards have increased. You dismantle all the pillars, and then the statics experts will come in and measure and tell you where you need to reinforce because of possible earthquakes. No one will accept a fixed price on that basis because no one can really estimate the situation. That's the reason why we have an addition of CHF 20 million. Any more questions from the hall?
Glaring guidance to the upper end, but given annualizing H1 FFO1, one takes full year above guidance. Why not increase? Can you walk us through H2 impact that gives lower FFO per share?
Fundamentally, you cannot simply double the figures. There are some seasonality effects included. If we look at our guidance, we're not far away from doubling. Of course, we do more detailed calculations than doubling, so that's our guidance, at the upper end of it.
The second question was, is the 80% letting in line with our expectations? Can you give some more color on the interest you see, and does the guidance assume 100%?
I give the first answer. We would actually be at 90%, but still are at 80%. Why? The FlowBank had the problem. There were instructions from authorities that FlowBank couldn't continue with this business. We are re-letting that, and we would assume that by the end of the year, we'll be at around 95%. Is that in agreement with my expectations? I think we're about one year too late, to be very honest. I thought it would be quicker to let in Geneva, and yet it's absolutely the right place to be for the future. It took one year more, and we had the FlowBank issue. I would assume that we're almost fully let by the end of the year. Karin, do you disagree? We're seeing an increased interest, let me add, in the past weeks and months. We had many requests coming in.
We concluded seven-year agreements, with companies moving in in the second half of the year. We're confident we'll be ending up where René mentioned by the end of the year.
What's the final answer? Has the capital raise deployment taken longer than expected? Why so? Is there more competition?
All of the transactions that we have done were in our pipeline in January. We saw that, A, these are sale and leaseback transactions, which often turn out to be more complex in negotiation. Sometimes there was a tenant who wants to stay on, but everybody had their own interest. We are also expecting that we will also be able to come to conclusions with the others, even though our negotiations take somewhat longer. Here, Ken has another question. Two questions, two small questions. The first one concerns Google as a tenant. Have they started preparing the building? Are there any potential alternative new tenants of the buildings? Google remain. They pay their lease, and they have not returned it, unlike many others. They don't intend to either. They have not started building work, internal building work yet, but of course, we can't lease it to anyone else.
The last question concerns the strategic contribution of asset management in the medium term. If I understand you correctly, the current contribution has recently risen from 7% to 12% EBITDA. How much more are you expecting this to increase? In other words, what is a reasonable contribution outside of the real property portfolio? We discussed this in detail at the Capital Markets Day. I would say that in the next three to five years, we will be between 10% and 15%. This year, we had a special situation because we had very strong growth in asset management and the growth in property portfolio not being so strong in the first six months because we're still working on individual projects. With full deployment and the implementations of the construction projects, this is going to balance things out a little. We're going to be in that range. We're both growing.
Both parts are growing, actually. Maybe also remind you of our medium-term objectives, two of them. By the end of 2027, we want 16 to 17 billion assets under management with an EBITDA contribution of CHF 75 million. As far as the real estate AG, is the rental income by 2028 objective. This shows our trajectory. The business of our asset management is very stable, and we're very close to the market, of course. Asset management of CHF 27 billion is able to give us opportunities for sales or acquisitions in the real estate sector. These help each of these two areas help each other a bit. That's a good thing. That was the answer to the question nobody asked. Are there any questions, any further questions here in the room? Do you have one?
We have one question coming from the English telephone line from Ventsi Iliev from Kempen. Please go ahead.
Hi, good morning. I think I had a question on guidance, but that should have been asked already. On SPS Solutions, if I look at the slide, you reported recurring fees of 41 bps, if I'm not mistaken. If I look at 2024 full year, that's 49 bps. I just wanted to get a view. Is there some seasonality or is there a structural difference as well? My second question is on the transaction in Lausanne. If I look at your slides from the CMD, you were guiding for an over CHF 200 million transaction. I just wanted to hear where the gap comes from. Thank you.
Would you like to answer that? Let's start with the EBIT. The second half year is usually a little stronger, also on the recurring side. Typically, construction volume is stronger in the second half of the year. There is no structural difference. This is more of a seasonal effect, and that is why we always do a comparison with the previous year, the same period of the previous year. That shows that we are, this is quite stable, this 41%. Once again, we're going to see the same effect at the end of this year. That is just a seasonal fluctuation. Concerning the acquisition pipeline, we stick with our acquisition targets and there are no changes. All the discussions also at the Capital Markets Day continue to be valid.
The only thing that I didn't say is that, of course, when we have a transaction, we also need tenants in place, and that usually takes a little longer than we would hope for. Since I have this slide here, EBITDA, anyone who does asset management knows that normally the last quarter is the most interesting or the most attractive quarter. You can certainly double this figure and add 10%, and then you can see more or less where we'll end up at the end of the year. Just a follow-up question in Lausanne. You said that you were looking at a property of more than CHF 200 million, rental income of CHF 7.5 million. Is this a different property? No, it's the same one, but we decided to correct the 200 down a little.
The part that we've bought, these are two finger docks, and those are all rented out already. That is why, and this is also Ken's question. If these tenants can be taken over, and if you have a structure that is already prepared for these existing tenants, it's much easier to replace any tenant that may leave. We thought that this was the most interesting part, and that is why. Okay, now back to Ken.
[Foreign language]
We know the tenants, not just by name, but we know what they do. As of today, no impact by the tariffs. If you ask me personally for my personal view, I think it's going to continue like that. There won't be an impact unless Switzerland suffers an economic downturn as a whole. That will lead to a different environment. The tariffs themselves, there is no impact. Are there any more questions?
In that case, thank you very much. Also, being here in person, it's always fun to speak to people in person. We would like to invite you to join us for an apéro on the 35th floor. Thank you once again for your interest and have a great day.